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Alice in Health Care: Part III (Thomas Sowell)
Creators Syndicate ^ | March 3, 2010 | Thomas Sowell

Posted on 03/03/2010 4:36:46 PM PST by jazusamo

With all the controversies, charges, counter-charges and buzzwords swirling around the issue of medical care in the United States, there is a lot to be said for going back to square one and asking just what is the fundamental problem.

The quality of the medical care itself is not the problem. Few— if any— countries can match American medical training, medical technology or the development of life-saving pharmaceutical drugs in the United States. Most countries with government-controlled medical care cannot come close to matching how fast an American can get medical treatment, particularly from specialists.

Political hype is no reason to throw all that away. In fact, policies based on political hype over the years are what have gotten us into what is most wrong with medical care today— namely, the way it is paid for.

Insurance companies or the government pay directly for most of the costs of most medical treatment in the United States. That is virtually a guarantee that more people will demand more medical treatment than they would if they were paying directly out of their own pockets, instead of paying indirectly in premiums and taxes.

Since people who staff either insurance company bureaucracies or government bureaucracies have to be paid, this is not bringing down the cost of medical care, but adding to it.

What also adds to the costs are politicians at both state and federal levels who mandate additional benefits to be paid for by insurance companies, thereby driving up the cost of insurance.

If medical insurance simply covered risks— which is what insurance is all about— that would be far less expensive than covering completely predictable things like annual checkups. Far more people could afford medical insurance, thereby reducing the ranks of the uninsured.

But all the political incentives are for politicians to create mandates forcing insurance companies to cover an ever increasing range of treatments, and thereby forcing those who buy insurance to pay ever higher premiums to cover the costs of these mandates.

That way, politicians can play Santa Claus and make insurance companies play Scrooge. It is great political theater. Politicians who are pushing for a government-controlled medical care system say that it will "keep insurance companies honest." The very idea of politicians keeping other people honest ought to tell us what a farce this is. But if we keep buying it, they will keep selling it.

One of the ways of reducing the costs of medical insurance would be to pass federal legislation putting an end to state regulation of insurance companies. That would instantly eliminate thousands of state mandates, which force insurance to cover everything from wigs to marriage counseling, depending on which special interests are influential in which states.

It would also promote nationwide competition among insurance companies— and competition keeps prices down better than politicians will. Moreover, competition can bring down the costs behind the prices, in part by forcing less efficient insurance companies out of business.

Another very real and very big cost behind the high prices for medical treatment are the many forms of expensive "defensive medicine" that doctors and hospitals have to practice, in order to avoid being sued by unscrupulous lawyers. Expensive and unnecessary tests and treatments cost even more than the multimillion dollar awards that clever lawyers can get from gullible juries.

Tightening up the laws, so that junk science does not prevail in courts, would create some real savings in medical costs. But, since plaintiff's lawyers are big financial contributors to the Democratic Party, that is unlikely to happen during this administration.

Finally, there are costs that are high because people want medical care in more comfortable surroundings— a private room rather than a bed in a ward, for example— and are willing to pay for that. This is more common among Americans.

There is no reason for others to interfere with that, just because of a mindless mantra of "bringing down the cost of medical care" or class warfare rhetoric about "Cadillac health plans."


TOPICS: Culture/Society; Editorial; Government
KEYWORDS: healthcare; heathcare; obamacare; sowell; thomassowell

1 posted on 03/03/2010 4:36:47 PM PST by jazusamo
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To: abigail2; Amalie; American Quilter; arthurus; awelliott; Bahbah; bamahead; Battle Axe; ...
*PING*
Thomas Sowell

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Recent columns
Alice in Health Care: Part 2
Alice In A Health Care Wonderland
Sowell: Free Market Fights Discrimination

Please FReepmail me if you would like to be added to or removed from the Thomas Sowell ping list…

2 posted on 03/03/2010 4:40:31 PM PST by jazusamo (But there really is no free lunch, except in the world of political rhetoric,.: Thomas Sowell)
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To: jazusamo

BUMP! :)


3 posted on 03/03/2010 4:41:37 PM PST by Diana in Wisconsin (Save the Earth. It's the only planet with chocolate.)
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To: jazusamo

Thanks for the ping jaz.


4 posted on 03/03/2010 5:10:32 PM PST by rockinqsranch (Dems, Libs, Socialists...Call 'em What you Will, They ALL have Fairies Living In Their Trees.)
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To: jazusamo

I highly commend all three parts of this essay. It is a very readable, logical, worthwhile and persuasive argument for stopping Obamacare dead in its tracks!

Thanks for the post!


5 posted on 03/03/2010 7:01:59 PM PST by Taxman (So that the beautiful pressure does not diminish!)
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To: Taxman

You bet, it’s always a pleasure to read Dr. Sowell but these are especially good.


6 posted on 03/03/2010 7:18:49 PM PST by jazusamo (But there really is no free lunch, except in the world of political rhetoric,.: Thomas Sowell)
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To: jazusamo
The very idea of politicians keeping other people honest ought to tell us what a farce this is.

No kidding. Sometimes I just can't believe how stupid people are ... and I'm not even Thomas Sowell. It must be agonizing for him.

7 posted on 03/04/2010 5:21:18 AM PST by Tax-chick (Aw, CUSSWORDS!!!)
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To: jazusamo
Insurance companies or the government pay directly for most of the costs of most medical treatment in the United States. That is virtually a guarantee that more people will demand more medical treatment than they would if they were paying directly out of their own pockets, instead of paying indirectly in premiums and taxes.

This the key point of the whole health care debate. Why didn't Republicans say it loudly, clearly, and repeatedly during the recent Thursday faux health reform summit?

Establishment Republicans are a big, big, part of the the problem. Kudos to Perry for taking out Kay Bailey Hutchinson.

8 posted on 03/05/2010 12:34:44 AM PST by SupplySider
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To: jazusamo

Look at the name calling, suits, etc if an insurance company turns down a second or third liver transplant expecially on a kid. Look at the demands for very ultra expensive treatments for lifestyle diseases such as AIDS, which is totally preventable. We either have to face making those who demand those type of treatments pay the cost or they will not be available.


9 posted on 03/05/2010 2:54:28 PM PST by midwyf (Wyoming Native. Environmentalism is a religion too.)
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To: midwyf

I just cringe when I hear Obama and his lib cronies talk about Insurance Co having to eliminate preexisting conditions for everyone. If that happens there’s no way the cost of health care is going down.


10 posted on 03/05/2010 3:03:56 PM PST by jazusamo (But there really is no free lunch, except in the world of political rhetoric,.: Thomas Sowell)
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